Back-to-School Sales Expected to be Flat as Parents Practice Restraint, According to NRF -Most in Survey’s History Will Head to Department Stores to Shop-
Washington, July 21, 2011 – As they prepare for their annual back-to-school shopping trip, parents this year will make children scour their closets before agreeing to buy any new jeans, pencils or backpacks. According to NRF’s 2011 Back-to-School survey conducted by BIGresearch, families with children in grades K-12 will spend an average of $603.63 on apparel, school supplies and electronics, within a few dollars of last year’s $606.40 average. Total spending on grades K-12 is expected to reach $22.8 billion.*
Combined K-12 and college spending will reach $68.8 billion**, serving as the second biggest consumer spending event for retailers behind the winter holidays.
“Families aren’t opposed to spending on what they need, but parents want their children to take a good look around at what they already have before deciding what to buy for back to school this year,” said NRF President and CEO Matthew Shay. “Retailers understand consumers are extremely focused on value and are taking this opportunity to offer substantial savings on merchandise.”
Although the worst of the recession is over, a shadow of insecurity still remains when it comes to how the economy will impact consumers’ back-to-school plans. According to the survey, Americans are compensating for the economy by purchasing more store-brand or generic items (39.9%), comparison shopping more online (29.8%), and shopping for sales (50.0%). Additionally, nearly half of survey respondents said the economy is forcing them to simply spend less in general (43.7%).
Having replenished many of their children’s needs last year, average spending on clothing ($220.60) and school supplies ($88.99) will slightly decrease this year. Families will also spend an average of $104.53 on shoes, a slight increase over last year.
Though average spending on computers, cell phones, mp3 players and tablet devices is expected to increase slightly to $189.51, just over half (51.9%) of families with school-aged children plan to purchase electronics this year, down from last year’s historically-high 63.7 percent. The percent of people who plan to purchase apparel, shoes and supplies will decrease as well, demonstrating that many families are making conscious decisions to buy only what they need.
Having done their own homework on what today’s families want, department stores are expected to see a surge in back-to-school traffic thanks to popular private labels, promotions and innovative social media campaigns. According to the survey, 57.0 percent of back-to-school shoppers will head to a department store, up from 53.9 percent last year and the most in the survey’s eight-year history. Though the majority of back-to-school shoppers plan to make at least one purchase from a discount store (68.4%), clothing stores (48.7%), office supply stores (38.0%) and electronics stores (21.7%) will also be popular. Additionally, more people this year will shop online (31.7% vs. 30.8% last year) and in drug stores (21.1% vs. 19.5% last year).
“Back-to-school shopping may be exhilarating for kids who ride along, but for mom and dad this is serious business,” said Pam Goodfellow, Consumer Insights Director, BIGresearch. “By shopping around at a variety of retailers before deciding where to buy, parents will be able to find the best values on the items they really need this year.”
Though many retailers began filling their shelves with merchandise right after the Fourth of July, more parents this year will start their shopping closer to the beginning of school. While most families will begin shopping three weeks to one month before school starts (42.4%), nearly one-third (31.2%) will begin their shopping one to two weeks before school starts - up from one-quarter (24.8%) last year. Some will get a jump start and begin shopping two months before the new school year (21.8%) and the remainder will shop the week school starts (2.0%) or after school starts (2.6%).
The survey found that teenagers will spend about the same amount as last year for certain apparel, supplies and accessories. Teenagers are expected to shell out an average of $31.64 for school items, compared to $31.74 last year. Pre-teens, largely reliant on their parents for an allowance, will spend less this year ($15.12 vs. $18.27 in 2010). When it comes to how much say children have in parents’ buying decisions, nearly two-thirds of parents (61.2%) say their children influence 50 percent or more of back-to-school purchases. Four out of Five Back-to-College Shoppers Say Economy Impacting Spending - College Shoppers Begin Shopping Earlier, Spend Less on Electronics-
NRF’s 2011 Back-to-College survey, conducted by BIGresearch, found more college shoppers this year will make adjustments to their budgets because of the economy. According to the survey, parents and students will spend an average of $808.71 on everything from apparel and electronics to dorm furnishings and food items, down from $835.73 last year. Combined K-12 and college spending will reach $68.8 billion.**
Four out of five (83.7%) respondents say the economy will impact their spending plans. More shoppers than last year will purchase store brand or generic products (38.0% vs. 34.1% in 2010), and more will comparison shop online (30.7% vs. 23.2% in 2010). Additionally, many shoppers are making do with last year’s items (29.7%) and spending less overall (44.6%) – trends also evident in NRF’s 2011 Back-to-School survey.
“College students and their parents, who are likely also spending thousands of dollars on tuition, will be looking for ways to stretch their budgets and find good deals this year,” said NRF President and CEO Matthew Shay. “To compensate, retailers will spread out their promotions to capture the attention of shoppers whenever they’re in the mood to spend, and will use every resource they can to prominently promote everything from bedding to mini refrigerators and, of course, laptops and smartphones.”
The survey found 45.8 percent of students and their parents will buy electronics, the lowest level since 2005. However, electronics will still take up the largest portion of shoppers’ budgets with the average person expected to shell out $209.93, an 11 percent decrease over last year’s $236.94. Freshman will spend the most on electronics ($281.94 on average).
“Young adults are often the first in line to buy the latest tablet device, smartphone or mp3 player, so many college students are already armed with the latest gadgets they’ll bring with them to campus,” said Pam Goodfellow, Consumer Insights Director, BIGresearch. “A decline in electronics spending could also be due to the fact that many popular college items, like laptops, have experienced huge drops in price over the last several years.”
Shoppers will also spend on clothing and accessories ($127.37), dorm furnishings ($96.84), food items ($94.60), school supplies ($61.48) and personal care items ($64.44). For those late-night study sessions, mom and dad may even put some meals “on them” and send their child to school with gift cards in hand, with the average person expected to spend $60.46 on gift cards or pre-paid cards.
Department stores won’t only be popular with K-12th graders this year: college students will be sure to hit up their favorite store as well. Nearly half (47.6%) of families with college-aged children will shop at a department store, up from 42.5 percent last year. Others will shop at discount stores (53.9%), drug stores (19.4%), home furnishing or home decor stores (11.2%), office supply stores (33.4%), clothing stores (34.2%) and electronics stores (19.6%). Online retailers will see a nice boost in traffic this year – one-third (33.4%) of respondents plan to shop online, up from 28.6 percent last year.
This year’s survey found that one-quarter (24.4%) of college shoppers will begin their shopping at least two months before school starts, the highest percent since NRF began conducting the survey in 2003. Others will head out three weeks to one month before school starts (28.9%), one to two weeks before (27.9%), the week school starts (9.4%) or after school starts (9.4%).
Like last year, most say their child will live at home (52.9% vs. 51.8% in 2010), though one-quarter (24.7%) will live off campus at a house or apartment. Eighteen percent will live in a dorm room or college housing and 3.6 percent will live in a fraternity or sorority house.
About the Survey
NRF’s 2011 Back to School and Back to College Consumer Intentions and Actions Surveys were designed to gauge consumer behavior and shopping trends related to back to school spending and back to college spending. The surveys were conducted for NRF by BIGresearch. The poll of 8,684 consumers was conducted from July 1-6, 2011. The consumer polls have a margin of error of plus or minus 1.0 percent.
BIGresearch® consumer intelligence provides analysis of behavior in areas of products and services, retail, financial services, automotive and media. The BIGresearch Consumer Intentions and Actions® Survey (CIATM) of 8,000+ respondents is conducted monthly and the Simultaneous Media Usage® Survey (SIMM®) of 15,000+ respondents is conducted semi-annually.
As the world’s largest retail trade association and the voice of retail worldwide, NRF’s global membership includes retailers of all sizes, formats and channels of distribution as well as chain restaurants and industry partners from the United States and more than 45 countries abroad. In the U.S., NRF represents an industry that includes more than 3.6 million establishments and which directly and indirectly accounts for 42 million jobs – one in four U.S. jobs. The total U.S. GDP impact of retail is $2.5 trillion annually, and retail is a daily barometer of the health of the nation’s economy. www.nrf.com.
* Extrapolation of U.S. population of adults 18+ ** Back-to-College spending is separate from Back-to-School spending, but combined makes up the second largest consumer spending period of the year behind the winter holidays